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Samsung Warns of Profit Drop on Weaker Demand

Samsung says second-quarter profit could fall as much as 26.5% from a year earlier. The WSJ's Ramy Inocencio speaks with Asia Technology Editor Yun-Hee Kim about the company's declining smartphone sales and the effect of a strengthening won.

SEOUL—Samsung Electronics Co.'s warning of a third-straight quarter of profit decline highlights the pitfalls of the South Korean technology giant's reliance on smartphone sales.

While strong smartphone sales have propelled the company's growth over the last two and a half years, the reliance on them is a double-edged sword. When sales are good, the benefits trickle down to its other businesses, including components.